Rachel Reeves – 2015 Parliamentary Question to the Department for Work and Pensions

The below Parliamentary question was asked by Rachel Reeves on 2015-11-30.

To ask the Secretary of State for Work and Pensions, what estimate his Department has made of the effect on the household income of an existing tax credit claimant family with two earners and two children in (a) 2018-19 and (b) 2019-20 of proposed changes to tax credits assuming they are migrated to universal credit at the start of 2018 and experience a change in circumstance and lose their transitional arrangements.

Priti Patel

At the summer budget the Chancellor of the Exchequer set out the Government’s commitment to move the UK from a high tax, high welfare, low wage society to a lower tax, lower welfare, higher wage society. This remains the case, and Universal Credit (UC) is delivering this.

UC is a fundamentally different benefit to the legacy benefit system and provides people with support into, and to progress in work.

Therefore there is no meaningful way of comparing an unreformed Tax Credit system with Universal Credit. The Government has committed to transitional arrangements as we reform the benefits and Tax Credit system. Those transferred by DWP from tax credits to UC will receive Transitional Protection. In addition, estimates of entitlements under UC of the sort requested will vary depending on assumptions on the level of earnings.